Table of Contents
Garry Tan has turned Y Combinator into a startup again—applying zero-based thinking, cutting bloat, scaling impact, and rekindling its builder-first roots with founder-mode intensity. This is YC reimagined not as an institution, but as a living, evolving product.
Key Takeaways
- Garry Tan leads YC with zero-based thinking: if YC were created today, what would it include—and what would it cut?
- YC is now structured like a product: constant iteration, sprints, user-centric programming, and founder experience at the core.
- Scaling doesn’t mean dilution—YC balances 1,000+ companies a year while deepening quality and reach.
- Culture is curated through hiring, firing, promotion, and feedback loops—not perks or rituals.
- Hard tech, AI, and unconventional founders are now core bets—not side tracks.
- Politics, education reform, and local government activism are part of Tan’s broader vision for abundance.
- YC's partner-founder dynamic is “soft advisory” not control—"We’re not the boss, we’re the benevolent sherpa."
- Founder diversity—geographic, demographic, and intellectual—is now seen as a core advantage, not a side benefit.
- YC is building durable, founder-led companies with fewer employees and sharper focus thanks to AI-native playbooks.
Zero-Based Rebuilding: Making YC a Startup Again
- Garry Tan adopted zero-based accounting to evaluate every part of YC: "If we built it again, what would stay? What would go?"
- This pruning mindset is borrowed from gardening—cutting early to let strong branches bloom.
- He emphasizes long-term stewardship: "Culture is who you hire, fire, promote—not what’s written on walls."
- Tan reinstated founder-mode energy from day one, inspired by conversations with Airbnb’s Brian Chesky.
- YC cut underused programs, overhauled systems, and reimagined onboarding to match what current founders actually need.
- He believes founder empathy isn’t a buzzword—it’s an operational principle. Everything starts from user pain.
- The goal: make YC as sharp and essential today as it was in 2005—only bigger, more inclusive, and more generative.
- The internal mindset has shifted from tradition to experimentation: Tan encourages "burning good ideas to find better ones."
Scaling Without Dilution: The Mass-Custom YC
- YC now funds over 1,000 companies per year, up from just 15 per batch two decades ago.
- Despite scale, quality hasn’t dropped—if anything, Garry argues outcomes have improved.
- Demo Day now attracts over $1.2B in targeted capital annually.
- AI tooling, internal process automation, and streamlined partner involvement allow scalability without compromising mentorship.
- Partners now deploy their time more strategically—focusing on fewer, higher-leverage interventions across multiple companies.
- The program is evolving to include verticalized tracks, conferences (e.g., hard tech mini-summits), and differentiated founder pathways.
- YC treats scale not as volume—but as surface area. The goal isn’t to do more. It’s to touch more deeply.
- It’s building a multi-player mode for founder success—where peer groups, sector communities, and tools do much of the heavy lifting.
Founder Archetypes: Mispriced Outsiders and Spiky Talent
- YC is focused on technical builders—but wants to shatter myths about pedigree: "It's not just Stanford or MIT—it’s UIUC, it’s Nigeria, it’s open-source kids from nowhere."
- Tan seeks spiky people: deeply obsessed with one thing, often since youth.
- Systems thinkers who can decode customer needs and reverse-engineer complex environments are favored.
- He praises founders with commercial intuition: "They yank requirements out of users like a great seller listens."
- YC embraces archetypes beyond first-timers—returning founders (like Parker from Rippling) are welcomed and supported.
- Tan pushes against credential bias—his internal motto: "We look for signal, not surface."
- Some of the best founders YC has backed barely passed high school. What they share is resourcefulness, edge, and urgency.
Soft Power, Not Control: The Partner as Sherpa
- YC partners are not bosses—they are high-leverage advisors.
- “We’re here to help you not die. But if you want to drive off a cliff, that’s your call.”
- Good partners give spiky advice, not median content. Founders are expected to filter and decide.
- YC culture discourages blind obedience—even to PG’s own advice: “Trust your intuition, take what helps, discard the rest.”
- The partner-founder relationship is grounded in empathy, experience, and mutual respect—not coercion.
- Garry has added structured onboarding for partners to increase founder empathy and alignment.
- The partner memo system, where feedback is shared post-meeting, allows asynchronous wisdom transfer.
- YC’s power comes from trust, not enforcement. The founders stay in the driver’s seat.
AI, Hard Tech, and Vertical Ascent
- AI has exploded across the portfolio. Founders are building lean, high-margin SaaS tools for vertical industries.
- Examples include medical billing, legal services, and education—all ripe for AI-native disruption.
- Hard tech is booming—YC supports hardware startups with dedicated tracks, deep alumni support, and tailored capital access.
- The most compelling hard tech founders raise $5M–$20M post-demo day thanks to YC’s curated capital base.
- YC’s belief: AI may allow fewer hires, higher ARR, and more defensibility—but founder quality still matters most.
- Garry says the real unlock is merging technical edge with GTM velocity.
- YC sees itself as a launchpad for "fat-thin" startups: capital-efficient, high-leverage, deeply technical.
Beyond Startups: Civic Leadership and National Ambitions
- Garry Tan is investing time and capital into local politics, education reform, and public safety.
- Sparked by frustration during COVID and SF’s DA controversy, Tan stepped into the public ring.
- He believes the media vacuum and ideological gatekeeping weakened civil trust in the Bay Area.
- His goal: rebuild SF into a city that reflects abundance-minded moderation—not purity tests and dysfunction.
- At the state and national levels, Tan supports leaders like Brooke Jenkins and sees California as a potential bellwether for moderate reform.
- His worldview is founder-informed: focus on leverage, execution, and building coalitions that compound.
- He doesn’t want YC to stay in the valley echo chamber—he wants it to scale culture and courage.
Startup Philosophy, Reframed
- Tan rejects dogma—fat vs lean startup, compound vs focused—preferring founder-fit logic: "If you can raise with Keith Rabois, do it. If not, lean works."
- He encourages founders to play to their advantages: team, capital access, timing, and unique insight.
- YC’s real value is community and trust—batchmates sharing source code, co-investors building networks, and alumni reaching back.
- Tan sees YC as a knowledge graph of edge cases—every success becomes a forked path others can learn from.
- What persists: "Just build. Talk to users. Don’t die."
- With Tan at the helm, YC is more than a program—it’s a system for producing prosperity, one weird, brilliant builder at a time.
- In a world chasing unicorns, YC builds builders. And builders still change everything.
